Every business wants their goods delivered quickly, efficiently, and if they can avoid any shipping snafu, all the better. But it’s no secret at all to importers that delays were common due to the pandemic, along with other supply chain issues. Aside from these delays, the other issue at hand is that shipping rates have increased quite a bit, forcing businesses to either raise their costs or eat the extra.
The slowdowns have gotten so intense that, in some cases, you can even find goods on boats just waiting on the open sea to enter the port.
In this report by the Economist, they break down the various hurdles that importers are facing in 2022.
China immediately stopped port terminal docking after a few new cases of COVID-19 cropped up on their shores. And the new Omicron variant comes with even more closures. The problem here is that many customers are shopping online even more than before, so the demand has increased quite a bit. And while supply chains are working quite well in some places, the pandemic still leads to delays. That, combined with the volume of orders does show that there are some major challenges to overcome.
In a recent issue of FreightWaves on the topic:
“Amid the uncertainty permeating global shipping, one thing is certain: Delays at port are inevitable — and will be for quite some time. This leaves importers no time to spare, rendering additional delays unaffordable.”
All these things are obviously keeping the total costs at a very high rate. It’s a good idea to assess the total shipping costs before finding the right operator to work with for your importing needs. That’s because prices have increased quite a bit, yet there are still some options less expensive than others, which is something to keep in mind right now. Shopping around is key!
Ports are not used to having the volume of traffic they’re dealing with right now, and more often than not, they do have a long queue of ships that are waiting to unload the merchandise that they sold. With that in mind, port congestion is causing a lot of issues for businesses on the ground. Where possible, importers and their shipping partners should add a time buffer, so end-consumers don’t get sacked with delays.
But for a lot of businesses, the main issue is that these shipping rates will not go down. If anything, they are going to continue to climb, which can be very problematic for those trying to keep themselves in the green. So at this point, the Economist suspects that we can expect the problem to last for at least the end of the year — into 2023!
It might go even further than that, some even expect 2023 to bring the same problems. We hope things will become even better, so only time can tell where we go from here and what results we can expect. It’s more important than ever to implement better shipping solutions, but due to the demand and restrictions caused by the pandemic, we can expect these things to last for a lot more time. That being said, the industry is very profitable, since profits are higher when doing the year after year comparison.
Working with the right partners across your network is going to be incredibly important for riding the waves of the coming year. On this list of partners, a customs broker can ensure that your goods move through checkpoints smoothly — shaving off valuable time from your shipping time. If you’d like to explore working with a customs broker, you can start here.